CHILE The Andacollo hypogene copper-gold mine will become a reality. The directors of Toronto-based AUR RESOURCES have given their blessing to the US$336-million project in the north-central part of the country. The production target is 157.0 million lb of copper and 58,200 oz of gold annually for 21 years beginning in late 2009.
According to Aur, an internal rate of return (IRR) of 21%, on the invested capital will be achieved on a full equity basis after tax, at a copper price of US$1.50/lb in 2010 and US$1.20/lb thereafter and a gold price of US$700/oz in 2010, US$725/oz in 2011 and US$400/oz thereafter. Capital payback will be 2.9 years on this basis.
The plan for Andacollo includes truck-and-shovel mining in an open pit and conventional drilling and blasting on 10 metre benches at a waste to ore strip ratio of 0.19:1. The ore will be crushed and delivered to a mill which will produce copper concentrates containing byproduct gold. Copper and gold recoveries to the concentrate are expected to be 90% and 70%, respectively. The concentrates will be transported by truck from the mine site, a distance of approximately 59 km to the port of Coquimbo for shipment to smelters.
Proven and probable reserves are 429 million tonnes at an average grade of 0.39% Cu and 0.13 g/t Au. Additional details on the reserves and resources are posted at www.AurResources.com.
The property is 100% owned by Compania Minera Carmen de Andacollo, which is itself owned 63% by Aur, 27% by Compania Minera del Pacifico S.A., and 10% by ENAMI. The Andacollo deposit directly underlies the currently producing Andacollo supergene copper mine which is located adjacent to the town of Andacollo.